Rising health insurance premiums are a concern for consumers and their medical care givers. Both want to preserve access to high quality, affordable health care. However, empowering a government agency to decide what health insurance premiums will be, as proposed by Assembly Bill 52, is the wrong solution to this very real problem.

Health insurance premiums rise, in part, in response to the rising costs of the medical care we purchase with our insurance. And the chief driver of increased medical care costs is the increase in demand for and consumption of medical care caused by population growth and aging. The more our population grows, the more medical care is dispensed. Still more medical care is provided as people get older with declining health status. Add to that the higher cost of our direct care labor force; the cost of acquiring newer life‐saving and life‐improving medical technologies; and the cost of newer better and life‐extending medications, and the reasonable among us readily see that depressing health insurance premiums by arbitrary governmental rate setting does not begin to address any of the reasons why premiums are rising.

We medical care givers are concerned that Assembly Bill 52 might do more to harm access to medical care for our patients because premium rate setting by government will drive some health plans and insurers out of California. That will decrease consumer choice of plans, and that, in turn, will decrease the choice of medical care givers consumers may go to for their medical care needs because health plans are selective about which medical care givers they include in their provider networks.

We only have to look at how the state manages the Medi‐Cal program to see what will happen if we turn over our private health insurance to rate regulation by a government agency. This program for families on welfare and the disabled pays medical care givers so poorly that finding doctors, especially physician specialists, to treat them is the single, greatest access-to-medical-care challenge for these consumers. The depressed rates paid by the state to our hospitals that are prevented by law from turning anyone away is the chief reason for closure cited by 10 of the 11 hospitals that closed in Los Angeles since 2002.

There is a better solution already in play. Legislation passed last year, SB 1163, established rate review in California. Health plans now must actuarially justify rate increases for individuals and small businesses. The federal government has provided California a $1 million grant to establish the rate review process and hire actuaries. That is the way to go. Accordingly, the Legislature should reject Assembly Bill 52.

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